1. This is a case of deficiency of service of the National Insurance Company Ltd. (hereinafter the opposite party/insurer for short) as alleged by Md. Siraj Uddin (hereinafter the complainant/insured for short) for repudiating the claim without any basis.
2. Backdrop of the case, in brief, is that the complainant filed an application under Section 12 of the Consumer Protection Act, 1986 (hereinafter the Act for short) stating inter alia that the complainant being proprietor of M/s Siraj Rice Mill, situated at Rawarpar in the district of Nagaon, on 24/03/2011 insured his Rice Mill with the opposite party who issued policy viz. No. 200203/ 11/10/3100001132 in the name of the Rice Mill. That it is a Standard Fire and Special Perils Policy securing Rs.15,25,000.00 as sum assured in case of causing stipulated damage to the Rice Mill covering the period of insurance from 24/03/2011 to 23/03/2012. That on 30/10/2011, suddenly, the Rice Mill was gutted by fire destroying various belongings such as, rice mill, a vehicle bearing registration No. AS01-BC0026( Tata Magic), rice, paddy, cash money, CI sheet etc. causing a damage to the tune of Rs.18,91,029.00. That the complainant, along with all supporting documents, has been approaching the opposite party time and again for settlement of the damage claimed, but getting no positive response the complainant has sought for redressal of his grievances before this Forum claiming indemnification of his damage along with costs of litigation and compensation towards financial loss, physical sufferings and mental pain etc.
3. On referring the admitted complaint in terms of the provisions of Clause (a) of sub-Section (1) of Section 13 of the Act, the insurer in its written version of the case, denying all averments of allegations made in the complaint, stated that on receiving information from the complainant about the damage of the rice mill due to fire the insurer, as per normal practice, engaged one accredited surveyor to assess the damage caused by fire and the loss sustained by the complainant. It is also stated that the amount claimed by the insured is absurd and without any basis. The opposite party has further stated that opposite party not only has replied to all letters and queries made by the claimant but also responded the notice received from the advocate of the complainant and the papers claiming insurance coverage received from the claimant were disposed of on the basis of the report of the surveyor. Thus, there is no negligence on the part of the opposite party and therefore, the opposite party has insisted to dismiss the false complaint made by the insured.
4. From the pleadings of the parties, since on receipt of the information as to the damage of the rice mill due to fire made by the claimant the insurer engaged a surveyor to assess the damage and in various paragraphs, particularly paragraphs 14 onwards in the version of the case in writing the opposite party has admitted the fact that the insured obtained insurance coverage from the opposite party, it is apparent that the fact of damage caused by fire is not disputed. Though the opposite party has raised various pleas about non-joinder of necessary parties, complaint is barred by principle of waiver, estoppels and acquiescence etc. no evidence is led in this regard. Jurisdiction of this Forum being very limited as contemplated under Section 14 of the Act, and also from the trend of evidence of the insurer finding that repudiation of claim is being mainly surrounded by a particular fact, i.e. according to the surveyor total loss of the claimant due to fire though assessed at Rs.10,090.00, but when depreciation at the rate of 5% having been calculated net loss comes to Rs.9753.50 which is being below the policy excess of Rs.10,000.00 the insurer is not liable to indemnify the loss.
5. In consideration of the pleadings of the parties our discussions and decisions are confined to the following issues:
I S S U E S
(1) Whether the insurer has repudiated the claim of the complainant in a justifiable manner?
(2) Whether there is deficiency of service from the side of the opposite party repudiating the claim of the complainant?
(3) To what relief/ reliefs the parties are entitled?
6. From the complainant side, the complainant himself has been examined as PW1 and he has been duly cross-examined. The opposite party has examined three witnesses namely, Sri Amrit Raj Baruah (Branch Manager, Nagaon Branch), Sri Sumitra Gupta (Surveyor/Loss Assessor) and Sri Sushil Kumar Talukdar (Branch Manager, Hojai Branch) as DW1, DW2 and DW3 respectively who have also been duly cross-examined.
7. ISSUE No. 1
(a) It is an undisputed fact that claimant obtained Insurance Policy covering Rs.15,25,000.00 as sum assured from the opposite party covering the risk of his rice mill and the said rice mill having been damaged due to fire, observing due formalities, the complainant repeatedly requested the opposite party for settlement of the claim. The pleadings of the opposite party, as has been illustrated in the version of the case and depositions made by DW1 and DW3, is that on receipt of the information about the damage caused to the insured due to fire the opposite party engaged DW2 to assess the nature of damage and pecuniary loss to the insured. Accordingly, DW2 assessed the loss at Rs.9753.00 and as per his report policy excess limit is being Rs.10,000.00, in terms of the policy condition the insured is not entitled to get any amount from the insurer.
(b) When a middleman is engaged to estimate a situation to settle a dispute between the parties, the middleman should undertake the responsibility as a pious duty free from any partiality and without being influenced by any sort of covetousness and rapacity. Now, let us discuss the report of DW2and observations thereon.
(c) According to DW2 when he visited the place of occurrence he found, at the roof portion of the building of the rice mill, one fiber sheet had been melted and besides that 3 (three) numbers of Corrugated Galvanized Iron (GCI) sheets became out of shape and rusted because of the inferno and spraying of water to extinguish fire. Since those fiber sheet and the GCI sheets were used on the roof, obviously those were put on some support not on air. The Final Survey Report marked as ExtE under the head of Constructional Specification at sub-head Roof it has clearly been stated that GCI sheets were put on wooden structure. But nothing has been mentioned in the survey report under what state and condition the wooden support of those sheets were found. After purchasing of new fiber sheet and GCI sheets, those will not go automatically to the appropriate place of the roof. But DW2 when calculated the amount of loss he simply has taken into consideration of the rate of those sheets only absolutely oblivion to the cost of installation of replaced items. The wooden support of the roof may require some repair and replacement, fresh nails and/ or screws have to be purchased and some skilled and unskilled workers might be engaged for installation of those sheets. Surprisingly, these aspects are noticeably ignored in the report of DW2.
(d) DW2, in his report under the head of Profile of the Insured Unit at sub-head Books of Accounts stating that during survey the insured having produced a copy of stock register without being verified and endorsed by the concerning authority and under the head Survey Findings at paragraph 3 stating that the insured having expressed his inability to measure the weight of the stock, the surveyor DW2 assessed the damage of 3 quintals of husk and 50 kilograms of rice. On the other hand, Ext10 (the stock register) pressed into as documentary evidence by insured (PW1) contains seal and signature of the General Manager, District Industries & Commerce Center (DICC) and during cross-examination PW1 specifically stated that his rice mill is registered under DICC and in support of this fact PW1 has pressed into Ext5 (consists of three sheets). According to ExtE, accidental fire had taken place on the night of September 30th/ October 1st 2011 around 1:00 a.m. and Ext10 reveals that closing balance of the stock was as 305.46 kilograms of paddy, 265.94 kilograms of rice and 956 kilograms of husk on 30/09/2011. But no reason has been assigned in the report of DW2 as to why Ext10 could not be accepted as a true and genuine document. On the other hand, Ext7 (Fire Attendance Certificate) at serial No. 4 has described that rice mill including one vehicle, machine, rice, paddy, cash CI sheets etc. were damaged and according to Ext13 rice mill, vehicle and two trucks of rice & paddy were completely damaged.
(e) ExtE, the report of DW2 at page 5 reads:
Apart from the above, in absence of the Insured’s co-operation it was not possible on our part to take the specifications of the plant and machinery installed inside the mill, only we could take the specification of one electric motor, which are shown below:
The report that the complainant had failed to cooperate the surveyor, found to be absurd and illogical because such abstinence on the part of the complainant from cooperating the surveyor appears to be against the normal human conduct and behavior as the complainant is a victim caused by fire as well as an interested party to get relief out of coverage of his insurance policy inasmuch as
not only the complainant but also all dependent members of his family are supported from the income of the rice mill and under such circumstances the complainant would religiously assist any person whoever came forward to revive the livelihood of entire members of the family of the complainant.
(f) From ExtE at page 5 it is found that DW2 could take specification of one electric motor only even if the claimant did not co-operate DW2, which goes to show that those specifications had been collected from the embossment put on the body of the equipment. Because, according to ExtE at page 2 the date of establishment of the mill is 15/11/2010 and accidental fire had taken place about midnight of 30/09/11, that is, about ten months after the installation of the machineries. If he had entered into the premises of the rice mill definitely he had seen the machineries and he could have procured specifications embossed on other paraphernalia too as has been done in case of electric motor. But he was unable to collect specifications from the body of the other plant and machineries installed inside the mill. DW2 has not specifically stated whether the specifications embossed on the bodies of other machineries were decipherable or not at the time of his visit nor has he mentioned in his report as to whether other parts of the machineries are in serviceable condition. From this part of report it may be taken for granted that the specifications embossed on the machineries turned to be indecipherable due to combustion. Thus, the pretext taken that due to failure on the part of the insured to co-operate DW2 could not take the specifications of other machineries found to be not worthy of credence. Situated thus, a strong inference can be drawn that in reality the machineries were damaged due to fire, but just to make this fact obscure, DW2 has taken the plea of failure of the insured to co-operate the surveyor.
(g) Taking into totality of the entire materials available on Survey Report (ExtE), as have been revealed during the discussion above, we are constrained to hold that the report has been prepared by DW2, the Surveyor, without application of impartial and balanced mind. Situation being so, in repudiating the claim substandard report of DW2 having been based, the claim of the complainant is found to be disposed of in an unjustifiable manner.
Hence, this issue is answered in the negative and in favour of the complainant.
8. ISSUE No. 2
It is an admitted position that the insured obtained one policy bearing No. 200203/11/10/3100001132 covering Rs.15,25,000.00 as sum assured from the opposite party and during evidence complainant pressed into as many as 13 numbers of documents and opposite party has not raised any objection resisting the documents, except putting some suggestions. The main contention of the opposite party is that DW2 assessed the loss at Rs.9753.00 and as per his report policy excess limit is being Rs.10,000.00 in terms of the policy condition the insured is not entitled to get any amount from the insurer. But none of the officers of the opposite party cross-checked the report of DW2 nor did they visit the place of occurrence before finalization of repudiation of the claim of the insured. Thus, deficiency of service on the part of the opposite party found to be noticeable.
Accordingly this issue is answered.
9. ISSUE No. 3
(a) The complainant in his application as well as in evidence on affidavit at paragraph 4 has claimed indemnification of Rs.18,91,029.00 for loss of not only the stocks kept in the mill and partial damage of the building and machineries but also for the damage of his vehicle. According to the policy condition it covers only the risk of the building and machineries inside it, not the risk of the vehicle. Therefore, the complainant is not entitled to get compensation for the damage of his vehicle out of the present insurance policy.
(b) Ext10 (stock register) is silent as to the stock-in-trade consisting of customer’s rice and paddy. On the other complainant’s stock was very meager at the relevant time of accident as has been observed in the stock register.
(c) It is an admitted position that the insured obtained a policy bearing No. 200203/11/10/3100001132 covering a risk of Rs.15,25,000.00 and the establishment of the insured was damaged due to accidental fire. As discussed under Issue No.1 and Issue No. 2 above that repudiation of the claim of the complainant has found be not based on justification and it has exclusively been observed that there is deficiency of service on the part of the opposite party. In view of the above facts and circumstances we are of the considered opinion that the insurer, in terms of the contract under the policy, has obligation to indemnify the loss sustained by the insured.
(d) That apart, the complainant has been deprived of his legitimate claim for which he has to move from pillar to post for a considerable period to establish the genuineness of his claim and thereby he has been suffering a lot, financially, physically and mentally. Such being the position the complainant is not only entitled to get interest on the sum that has been entitled to receive as indemnification from the date of his claim before this Forum but also entitled to get an additional amount as compensation to solace his physical and mental tiredness as well as financial involvement. (e) Now, the insurer is to indemnify the of loss of the complainant as computed here under:
For damage of building: Rs.5,00,000.00 Depriciation 5% Rs. 4,75,000.00
For loss of machinery: Rs.4,50,000.00 Depriciation 5% Rs.4,27,000.00
For loss of furniture etc: Rs.1,75,000.00 Depriciation 5% Rs.1,66,250.00
For loss of stock: Rs.10,000.00 Rs.10,000.00
For loss of stock (customer’s): Nil Nil .
Total Rs.10,78,250.00
This issue is answered accordingly.
ORDER
The opposite party National Insurance Company Limited is hereby ordered to disburse a sum of Rs.10,78,250.00 (Rupees ten lakh seventy eight thousand two hundred & fifty) only, as an indemnification towards loss caused to the complainant, within 30 (thirty) days from the date of receipt of this order.
The opposite party National Insurance Company Limited is further ordered to pay interest at the rate of 6% per annum on the total sum of Rs.10,78,250.00 (Rupees ten lakh seventy eight thousand two hundred fifty) only from the date of filing this case, that is, with effect from 08/07/2013 till the date of finally settled the disbursement of the due amount.
It is further ordered that National Insurance Company Limited shall pay a sum of Rs. 10,000.00 (Rupees ten thousand) only as compensation to solace the physical and mental sufferings and another sum of Rs. 5,000.00 (Rupees five thousand) only as costs of the litigation to the complainant.
Given under our hand and seal of this Forum this 28th day of December, 2018.
